Improving business through smart energy and environment ... - IBM

Improving business through smart energy 

and environment policy 

February 2009

February 2009 

Improving business through smart energy 

and environment policy 

Businesses and public entities today face increasing pressure to develop policies that 

are both good for the planet and good for business. A framework developed by 

IBM offers businesses and other organizations a comprehensive approach to energy 

and environmental issues. The framework helps identify and prioritize environmental 

efforts by breaking down problems and opportunities into seven distinct business 

areas, which can then be segmented into manageable projects. 

The pressure to “go green” 

As global warming heats up the planet, as the price of 

gas and electricity soars, as a global water shortage 

looms, the world has begun to understand the need for 

energy conservation and environmental stewardship. This 

environmental concern has now hit the corporate mainstream. 

Companies are operating in a new regulatory environment, 

one that sets more stringent controls over energy 

and water consumption, greenhouse gas emissions, the 

use of hazardous substances and the disposal of both 

standard and hazardous waste. Many businesses find their 

stakeholders—investors, employees and customers— 

demanding corporate environmental responsibility. 

Additional pressure comes from the media and environmental 

advocacy groups. 

Environmental opportunities and challenges 

Executives interviewed for the IBM 2008 Global CEO 

Study report that their concern about environmental 

issues has doubled over the past four years, a concern 

that is filtering to CIOs and line of business leaders. These 

professionals are now being asked to quantify and reduce 

corporate energy use and environmental footprints, meet 

regulatory requirements related to the reduction of greenhouse 

gases, and modify IT departments to drive more 

energy-efficient operations. 

These activities are not merely environmentally responsible: 

they can also drive business opportunity. According to the 

Global CEO Study, chief executives believe that energy 

and environmental activities can help differentiate their 

brands and burnish the reputation of their products and 

services. Enhanced brand image can deliver market permission 

(allowing companies to enter new markets where 

environmental concerns may be paramount) and drive 

customer loyalty. 

But developing a smart energy and environmental policy is 

a complicated process. That’s why many companies have 

yet to develop any type of comprehensive policy. Those 

entities that do strive to craft overall energy and environmental 

stewardship plans often take siloed approaches to 

the issue. This means they concentrate on one or two 

specific problems without determining how business activities—overall 

operations, product lifecycle management, IT, 

property management and other factors—interrelate. 

An energy and environment framework 

IBM has developed a comprehensive approach to assisting 

clients with energy and environmental issues. This 

framework helps identify and prioritize environmental 

efforts by illustrating how problems and opportunities can

e broken down into distinct areas and then segmented 

into manageable projects. These projects can be joined to 

form a cross-organizational program for managing energy 

and environmental issues. 

The framework consists of the following seven business 

issues: 

● Strategy: The creation of an enterprisewide energy and 

environment strategy can help companies address 

“green” issues. 

● People: Work behaviors—especially commuting and 

business-travel behaviors—form a large part of an 

individual’s carbon footprint. Companies can reduce 

commuting and traveling through the use of online collaboration 

tools. Policies that reduce employee travel 

and commuting time are becoming increasingly important 

in attracting and keeping top talent. 

● Information: As regulations and reporting requirements 

compound, collecting, measuring and acting on the right 

information will be critical to an organization’s ability 

to make complicated trade-offs between business 

alternatives. 

● Product: Companies can design products in a manner 

that reduces environmental impact. For example, 

streamlining of product development and manufacturing 

means less waste created and less energy consumed. 

● Information technology: IT is putting increasing levels 

of stress on power and cooling infrastructures. A thorough 

understanding of IT energy consumption, operations 

and constraints is the foundation for improvement. 

From this foundation, companies can devise strategies 

to help them improve IT efficiency and resiliency. 

● Property: Companies need to reduce the cost and 

greenhouse gas emissions of their physical assets. 

The process starts with determining and managing the 

environmental impact of physical assets and properly 

maintaining all property for energy-efficient operations 

and reduced environmental impact. 

● Business operations: Corporations need to transform 

business processes to reduce environmental impact for 

operations end to end. Consider energy or water consumption, 

as a start. Understanding and controlling 

these costs can only be achieved once a company 

measures its existing use and compares it against 

conservation benchmarks. Through the use of “smart 

systems,” dramatic efficiency improvement can take 

place. 

When leveraged appropriately, “green” strategy, innovations, 

solutions and services can constitute a competitive 

edge for enterprise and for industries—making it possible 

to take care of business while taking care of the planet. 

For more information 

To learn how IBM is working with organizations around the 

world to help them create “green” businesses, contact 

your IBM marketing representative or IBM Business 

Partner, or visit the following Web sites: 

● ibm.com/cio 

● ibm.com/green

Improving business through smart energy and environment policy 

Contents 

4 The pressure to “go green” 

6 Environmental opportunities 

and challenges 

9 Developing environmental 

policies and programs 

10 An energy and environment 

framework 

14 Leading through example 

17 How IBM can help 

19 About the author 

20 For more information 

The pressure to “go green” 

As global warming heats up the planet, as the price of gas and electricity 

soars, as a world water shortage looms, everyone from regulators to the media 

has started taking environmental issues seriously. They call upon individuals 

and businesses to do the same. The need to “go green” has reached the corporate 

mainstream. 

Companies today operate in a new regulatory environment, one that sets more 

stringent controls over energy and water consumption, greenhouse gas emissions, 

the use of hazardous substances, and the disposal of both hazardous 

and standard waste. World governments explore and establish mandatory 

energy efficiency programs to reduce power consumption. Environmental 

advocacy groups track companies for environmental performance and quickly 

uncover enterprises that “greenwash” themselves without any credible documentation 

of the veracity of their claims. 

Business executives must also cope with stakeholder pressure to “go green.” 

Investors have begun to differentiate between corporate stocks that just make 

money and those that both make money and maintain strong environmental 

policies. (Witness the rise in “green” investment funds.) In regions of the world 

where employer need outstrips the talent pool, more and more potential 

employees are choosing to work for companies that—along with offering 

appropriate compensation packages—have a strong sense of environmental 

stewardship and overall corporate social responsibility. 

4


“The CIO must proactively 

work to identify and promote 

both existing and emerging 

technologies to address green 

issues outside the data center. 

The aggressive application of 

information technology and 

software is key to achieving 

more cost-effective and 

energy-efficient organizations.” 

— Rick Ptak, 

Ptak, Noel & Associates 

Consumers increasingly make buying decisions based on a vendor’s environmental 

credentials. According to the IBM study Attaining Sustainable Growth through 

Corporate Social Responsibility (CSR), CEOs, CIOs and line-of-business executives 

generally agree that customer expectations for corporate social responsibility 

are increasing. 1 (The environment is an obvious touchstone: climate change has 

become a call to action for many of the world’s consumers.) What’s more, 

75 percent of the roughly 1,100 chief executive officers and public sector leaders 

surveyed for the 2008 IBM Global CEO Study say that the number of advocacy 

groups following and reporting on their corporate social responsibility-related 

activities has increased over the past three years. 2 

Governments themselves are subject to pressure to develop and implement 

smart environment and energy policies. While public bodies are exhorting their 

citizenries to “go green,” many of these same citizens individually and collectively 

now expect their governments to mitigate their impact on the environment. 

Moreover, since government actions are so visible, their ability to set positive 

examples may enhance their credibility in regulating and pressuring organizations 

under their jurisdictions. 

While the global financial crisis may divert some of our attention from issues of 

corporate social responsibility—such as energy use and environmental stewardship—a 

comprehensive policy to increase energy efficiency and reduce materials 

and waste continues to provide immediate opportunities for cost savings, profit 

improvement, and talent attraction and management. It is interesting to note that 

both crises direct our attention to the issues of trust and integrity, helping to 

demonstrate the growing realization of our financial interconnectedness as well as 

our environmental interconnectedness. 

5


Environmental opportunities and challenges 

No wonder that environment and energy policies top many executives’ to-do 

lists. The Global CEO Study reports CEO concern about environmental issues 

has doubled over the past four years. As Figure 1 shows, the Asia-Pacific region 

has seen the most dramatic increase, with CEO attention to energy and environment 

issues nearly tripling since 2004. 

Figure 1. CEOs in each geography studied are increasingly finding environmental factors to be a top 

concern—and driver of change. 

While environmental concerns may start with the CEO, they filter to CIOs and 

line-of-business leaders who are being asked to quantify and reduce corporate 

energy use and environmental footprints, streamline supply chains, meet regulatory 

requirements related to the reduction of greenhouse gases, and modify IT 

departments to drive more energy-efficient operations. These activities are not 

merely environmentally responsible: they can also drive cost savings—another 

universal corporate mandate. For example, according to IBM projections, 

$1 in energy savings can often drive an additional $6 to $8 in operational savings. 

In addition, “green” policies can provide competitive differentiation. 

6


The business benefit of increasing energy and material effectiveness, along with 

increasing regulatory environments and pressure levied by the media, environmental 

advocacy groups, consumers and stakeholders, have made it necessary 

for today’s companies to rethink their energy and environment policies. 

Corporations face significant challenges in developing and implementing policies 

meant to conserve energy and protect the environment. But executives believe 

that energy conservation and environmental stewardship also present significant 

opportunities. (See “Green is the new black.”) According to the IBM Global CEO 

Study, CEOs believe that energy and environmental activities can help differentiate 

their brands and burnish the reputation of their products and services. 

Enhanced brand image can deliver market permission and drive customer and 

employee loyalty. Because of this, as Figure 2 shows, CEOs plan to increase their 

investment in corporate social responsibility by 25 percent over the next three 

years. (Corporate social responsibility is defined, for the purposes of this paper, 

as the actions taken by companies that choose to manage their businesses for 

positive impact on society. This is accomplished through economic, environmental 

and social activities.) 

Figure 2. CEOS are generally positive about the impact of rising corporate social responsibility 

expectations and they are increasing their investments in this area. 

7


But “going green” isn’t easy. That’s why many companies have yet to develop 

any type of comprehensive policy. Those entities that do strive to craft overall 

energy and environmental stewardship plans often take siloed approaches to the 

issue. This means they concentrate on one or two specific problems without 

determining how business activities—overall operations, product lifecycle management, 

IT, property management, employee commuting practices and other 

factors—interrelate. 

Companies wishing to develop and implement smart environmental, energy and 

sustainability practices are often stymied by issues such as: 

● Lack of a coherent, overarching energy and environment strategy 

● Lack of actionable data and the inability first to measure energy use and 

greenhouse gas emissions and then to determine how to reduce them 

● Lack of understanding of the steps that must be taken to enter new 

markets where issues related to energy, environment and sustainability may 

be paramount 

● Immature supply chains that don’t allow global consistency in the adherence 

to environmental policies 

● Product engineering, manufacturing and disposal practices that are incompatible 

with environmental stewardship 

● Travel and commuting policies that fail to consider energy use and environ- 

mental impact 

8


Electricity customers 

like control 

As part of the U.S. Department of 

Energy’s GridWise program, the 

Pacific Northwest National 

Laboratory wanted to ensure the 

health of the region’s electrical 

grid—especially in times of heavy 

use. To accomplish this, the 

Laboratory planned to manage 

electrical demand through a combination 

of intelligent technology and 

financial incentives. 

The Laboratory set up two parallel 

studies to test its ideas. In one, the 

organization created a virtual marketplace 

that allowed consumers to 

trade flexibility in usage for lower 

costs. The second study tested 

“smart” appliances that could 

sense and respond to stress on the 

electric grid by temporarily curtailing 

electricity use. 

The studies found that people far 

preferred the virtual marketplace— 

they wanted to control energy use 

themselves, rather than having a 

third party decide when to limit 

consumption. People trading flexibility 

in usage for lower energy 

costs saw, on average, a 10 percent 

reduction in their electric bills. 

Developing environmental policies and programs 

Leaders in boardrooms, public bodies, regions and industries now face growing 

pressures to become more sensitive to their organizations’ energy consumption 

and environmental impact. Enterprises look across their organizations, trying to 

address these issues by improving processes. Concurrently, business executives 

are keenly aware that the process of becoming “green” must aid business as well 

as the environment. 

To develop policies that are both good for the planet and good for business, corporate 

leaders must consider questions such as: 

● Are all aspects of my business, including operations, IT and product lifecycle 

management, efficient and protective of the environment? 

● As part of our overall strategy to increase business efficiency, are we 

considering that environmental stewardship and energy consumption are 

new business barometers? 

● Does my organization maintain a public commitment to meaningful and 

achievable goals, with transparency in reporting corporate progress in meeting 

those goals? 

● Are we taking a leadership position in driving energy conservation and environmental 

stewardship through the value chain and across our industry? 

● Do we have a strategy that supports reducing costs, lowering complexity, 

and increasing operating and energy efficiency? 

● Are we looking for ways to improve IT operations to generate more computing 

performance without increasing power consumption? 

● Are we experiencing social and regulatory pressure and responding with 

verifiable energy conservation initiatives that proactively address energy and 

climate challenges? 

● Are we pursuing the development of energy and environmental strategies 

and policies to improve business and brand position? 

9


An energy and environment framework 

Each of these issues can seem complicated when considered individually, perhaps 

overwhelming when viewed as an interrelated group. Understanding this, 

IBM has developed a comprehensive approach to assisting clients with energy 

and environmental issues. 

This framework helps identify and prioritize environmental efforts by illustrating 

how problems and opportunities can be broken down into distinct areas and then 

segmented into manageable projects to be addressed. These projects can be 

joined to form a cross-organizational program managing energy and environmental 

issues. 

This framework addresses the needs of various executives in developing and 

implementing energy and environment strategies: the CEO’s need to respond to 

customer, government and employee expectations; the CFO’s need to deal with 

changing cost dynamics for energy; COO’s and line-of-business needs to design 

and implement new processes; and the CIO’s need to increase computing power 

while managing energy consumption. 

The framework presented below has grown organically from IBM’s cross-industry 

expertise, innovative research, and experience helping enterprises to address 

energy and environmental challenges. IBM called upon its unique ability to bring 

technological innovations, business process transformation and industry expertise 

together into a comprehensive set of solutions and services. 

10


As delineated in Figure 3, seven business components are addressed in the 

framework: strategy, people, information, product, IT, property, and business 

operations. These components are common to virtually any enterprise or organization 

dealing with energy and environment issues. Encircling these are the 

IBM points of credibility in uniquely addressing client needs. 

Figure 3: This energy and environment framework addresses organizational components commonly 

in place. 

11


Strategy 

The creation of an enterprisewide energy and environment strategy as part of an 

overarching corporate social responsibility plan can help companies address 

“green” issues, resulting in improved financial and environmental outcomes. 

Issues to be considered include the alignment of a company’s environmental 

strategy into an overall business strategy and how environmental values may be 

translated into an improved brand image. 

People 

The impact of employee behaviors and policies on the environment is significant. 

Commute time and business travel form a large part of an individual’s carbon 

footprint. The use of online collaboration tools and policies that support reduction 

in commuting and traveling can also have an impact on costs. Finally, companies 

are discovering that their environmental policies and practices can impact their 

ability to attract and retain top talent. 

Information 

As regulations and reporting requirements compound, companies and organizations 

will need to make increasingly complicated decisions on the trade-offs 

between alternative business processes, manufacturing systems, transportation 

methods and supply sources. Knowing what to measure, collecting reliable information 

and effectively measuring and acting on it will be critical. These decisions 

will require even more granular information and more sophisticated decision support. 

Optimized information collection, analysis, tiering and storage will help with 

speeding access to information, addressing regulatory mandates and reducing 

the cost of reporting. 

12


“A strategic, top-down 

organizational strategic 

transformation must take place 

throughout the organization. 

Future sustainable 

organizations will have put in 

place a multifaceted, rigorous, 

and interconnected strategy 

directly linked to overall 

company strategy and goals.” 

— Crossing the Great 

Divide: Sustainability as 

Corporate Strategy, 

Stephen Stokes, AMR 

September 16, 2008 

Product 

As companies begin to understand the environmental impact of their products or 

services across the entire product lifecycle, they can design products in a manner 

that has a lower environmental impact. Streamlining of product development and 

manufacturing also means less material used, less waste created and less energy 

consumed. Concurrently, an examination of the product or service lifecycle often 

helps businesses find and exploit market opportunities. Finally, the need to 

reduce energy consumption is driving an increase in the energy-management 

intelligence built into certain products. 

Information technology 

Information technology is putting increasing levels of stress on power and cooling 

infrastructures. According to IBM estimates, IT kilowatt-hour usage has increased 

fivefold in the past five years. This IT-related energy use contributes to the establishment’s 

greenhouse gas emissions. CIOs and IT managers view this situation 

as an economic and environmental crisis. 

Corporations need IT energy efficiency strategies designed to help them focus 

their efforts. A thorough understanding of IT energy consumption, operations and 

constraints is the foundation for improvement. From this foundation, companies 

can devise strategies to help them improve IT efficiency and resiliency, address 

emissions, reduce energy costs and measure their success against business 

goals. 

13


Property 

Companies need to reduce the cost and greenhouse gas emissions of their 

physical assets—from office buildings to truck fleets. The process starts with 

determining and managing the environmental impact of physical assets and properly 

maintaining all property for energy-efficient operations and reduced environmental 

impact. Through improved maintenance and through improved tracking, 

deployment, location, and management of facilities and properties, reductions in 

environmental impact can be achieved. 

Business operations 

Corporations need to transform business processes to reduce environmental 

impact for operations end-to-end. Consider energy or water consumption, as a 

start. Understanding and controlling these costs can only be achieved once a 

company measures its existing use and compares it against conservation benchmarks. 

Through the use of “smart” systems, dramatic efficiency improvement can 

take place. Any transformation plan put into place must be communicated to key 

stakeholders. 

Leading through example 

Companies seeking to “go green” rightly look to partner with environmentally 

responsible businesses to procure technological products, services and solutions. 

In addition, companies need to partner with an enterprise known for its expertise 

in energy conservation, energy efficiency and environmental stewardship. IBM’s 

environmental policy (which was first issued in 1971), along with its supporting 

programs and results, demonstrate the company’s leadership and expertise in 

these areas. For example, between 1990 and 2007, IBM’s annual energy conservation 

actions saved 4.6 billion kilowatt hours of electricity consumption. This 

avoided nearly 3.1 million metric tons of CO2 emissions (equal to 45 percent of 

the company’s global CO2 emissions) and saved more than $310 million in 

energy expense. IBM has also voluntarily reported its environmental performance 

annually for the last 17 years. 

14


New data center saves power, 

aids corporate 

expansion 

The kika/Leiner Group, a top-five 

European furniture retailer, was 

undergoing a business expansion 

across Europe and the Middle East. 

Corporate executives worried that 

the company’s aging data center 

would be unable to support this 

growth. The retailer wanted a new 

data center, one that could support 

the expansion while providing 

energy efficiency and a compact 

footprint. 

A new-generation data center met 

the company’s business goals for 

both energy consumption and 

improved data center operations. 

The data center reduced power 

consumption by up to 40 percent. It 

also offered improved security and 

reliability, and a lower total cost of 

ownership—all of which proved 

important in supporting 

kika/Leiner’s expansion plans. 

Consider just three IBM recent initiatives: 

IBM Project Big Green: Announced in May 2007, Project Big Green is a 

$1 billion initiative to dramatically reduce energy use by IBM and its clients. The 

initiative includes new energy-efficient IBM products and services and a five-step 

approach to energy efficiency in the data center. This approach can sharply 

reduce data center energy consumption, transforming companies’ technology 

infrastructures and providing energy savings of up to 42 percent. 3 In June 2008, 

Project Big Green was expanded to include core software offerings that enable 

clients to extend their energy efficiency efforts beyond the data center. 

Carbon Management Best Practices: IBM and the Carbon Disclosure Project 

have launched a research project focused on the best practices employed by 

companies to gather and handle carbon dioxide-related data. The project seeks 

information from businesses that have extensive experience in measuring and 

managing greenhouse gas emissions. By getting insight into current actions, 

IBM and the Carbon Disclosure Project plan to craft a series of best practices 

related to CO2 management and reporting. The research will focus on proactive 

CO2 management programs, how the economy affects CO2 management, and 

how well companies understand issues surrounding greenhouse gas emissions. 

The Global Intelligent Utility Network Coalition: In 2007, IBM founded the 

Global Intelligent Utility Network Coalition, a group of utility companies working 

with IBM to accelerate the adoption of smart grid technologies and business 

solutions throughout the world. An intelligent utility network fundamentally transforms 

the way power is generated, distributed and used, adding intelligence 

throughout the grid to dramatically reduce outages and faults, improve responsiveness, 

handle current and future demand, increase efficiency, and manage 

costs. 

15


“There are profound 

opportunities to benefit from 

changes in the industry and 

how business models will be 

challenged.” 

— Electric utility CEO 

IBM’s environmental policy calls for the company to be an environmental 

leader in all its business activities. For example, IBM is committed to 

doubling its own computing capacity by 2010, without increasing power use. In 

house, IBM deploys data center energy-management techniques to diagnose, 

measure, manage, virtualize, cool and build servers. The company has a global 

energy program and objectives by which its physical properties are built and 

managed. In its business operations, IBM has programs to conserve resources, 

prevent pollution, evaluate suppliers for their environmental stewardship, and 

develop manufacturing processes that are protective of the environment. The 

company has a host of video conference and collaboration tools and work-life 

balance programs that enable its employees to reduce travel and related CO2 

emissions. IBM’s longstanding product stewardship program has enabled the 

company to develop and offer products with a wide range of environmental attributes, 

ranging from energy efficiency to the use of environmentally preferable 

materials and finishes. 

The company also excels in end-of-life IT product management and recycling. 

Over the past four years, IBM’s Global Asset Recovery operations have collected 

and reused more than 4.6 million machines while limiting the amount of product 

waste these operations have sent to landfills to less than 1 percent of the total 

waste they processed. What’s more, IBM Research has been instrumental in supporting 

IBM’s environmental efforts. It has invented numerous environmentally 

smart products beyond the scope of its usual business. For example, bringing 

unique skills from its vast experience in semiconductors and nanotechnology to 

the important field of alternative energy research, IBM Research has made 

advances in photovoltaics technology. These types of advances could deliver up 

to five times the efficiency of current solar farm technology. 

16


“IBM has taken a lead in the 

area of carbon management, 

particularly across government 

organizations. Its long history 

of running consulting projects, 

planning and supporting the 

delivery of solutions and its 

ability to work across areas 

such as estates management, 

procurement and IT, made it 

the perfect choice to help us 

meet our challenging target.” 

— David Young, 

Executive Director of 

Strategy and Performance, 

Natural England 

How IBM can help 

IBM’s research, innovation and experience in the fields of energy conservation 

and environmental stewardship, coupled with demonstrated environmental leadership 

both in house and in helping clients address energy and environmental 

issues, has created the company’s unique, overarching view of the challenges 

and opportunities that arise in the quest to “go green.” IBM is the leader in 

delivering innovative, end-to-end, results-oriented environmental solutions and 

services to corporations, governments, institutions and entire industries. 

IBM’s business and industry experts have helped clients think through complex 

environmental issues to arrive at answers that deliver business results. 

IBM does this because it thinks that corporate social responsibility and environmental 

stewardship are among the most important issues facing the world today. 

IBM’s point of view is a simple one: industry and business expertise coupled with 

technological advances can and must address issues of environmental stewardship 

and energy conservation. These issues must be addressed across corporations, 

across industries and across geographies. Only the companies that meet 

these environmental challenges will thrive in an arena where “green” is not only a 

laudable goal, but an imperative. 

IBM’s industry-oriented, multi-faceted offerings can provide enterprises with a 

competitive advantage, one that draws on IBM’s experience and capabilities 

across hardware, software, industry-specific solutions, business solutions, 

business services and research. With decades of leadership in environmental 

17


stewardship and technology innovation, a global talent pool of unmatched business 

and technical skills, specific industry process expertise, and a proven ability 

to solve complex challenges, IBM is uniquely positioned to offer clients: 

● A holistic approach to IT infrastructure efficiency, business process transformation, 

and the development of new products and services to address 

energy and environment issues and opportunities 

● Depth of experience based on nearly four decades of IBM environmental 

leadership and results gleaned from in-house management and from aiding 

thousands of clients in making their own businesses more protective of the 

environment 

● Solutions and services based on IBM’s deep business and process knowledge 

and unmatched capabilities for technological innovation 

When leveraged appropriately, energy and environmental strategies, innovations, 

solutions and services can constitute a competitive edge for enterprises and for 

industries. Your business can do well while doing good. 

18


Green is the new black 

To meet growing corporate social responsibility expectations, British retailer 

Marks & Spencer has embarked on a £200-million, five-year plan (known as 

Plan A) that impacts almost every aspect of its operations. 

Through this effort, launched in 2006, the retailer—known for its clothing, 

home products and grocery arms—wanted to engage customers in solving 

“green” issues. 

Marks & Spencer gave customers free reusable shopping bags. The bags 

were deployed “for life.” (If a bag wears out, the retailer will replace it for free.) 

When this initiative was in its fifth week, the company began charging shoppers 

for plastic bags. It donated the proceeds of plastic-bag sales to environmental 

charities. 

Very quickly, customers began reevaluating their need for plastic shopping 

bags. The fee, though quite small, made people stop to think about their 

impact on the environment. 

But the retailer’s initiative extends far beyond the checkout line 

Behind Marks & Spencer’s 35,000 products sit more than 20,000 factories, 

farms, fisheries and forests, and an estimated 500,000 workers in the developing 

world. Through its recently established online supplier exchange, the 

company strives to simultaneously improve both efficiency and sustainability. 

For instance, farmers who create biogases from farm waste are now selling 

the retailer their green electricity along with their beef. 

Since launch, the expected 40 million British pounds a year cost of Plan A has 

plummeted to zero as M&S has found new ways of saving money from green 

initiatives. Now each pound invested in Plan A change is paid for by a pound 

saving elsewhere in the company. 

About the author 

This paper was written by Ellen Johnson. Ms. Johnson is a senior marketing 

manager for IBM Global Business Services. She is also part of an extended team 

of IBM professionals working to help clients understand and improve their impact 

on the environment. Vik Chandra, Gail Jarrett, Christine Kinser, Diana Lyon, 

Christopher Spaight, Amy Stenard, Scott Stockwell, Andrew Verdesca and 

Graham Whitney also contributed to this paper. 

19

For more information 

To learn how IBM is working with organizations around the world to help them 

create “green” businesses, contact your IBM marketing representative or 

IBM Business Partner, or visit the following Web sites: 

● ibm.com/cio 

● ibm.com/green 

IBM Global Financing 

IBM Global Financing can tailor financing solutions to your specific IT needs. For 

more information on great rates, flexible payment plans and loans, and asset buyback 

and disposal, visit: 

ibm.com/financing 

© Copyright IBM Corporation 2009 

IBM Corporation 

New Orchard Road 

Armonk, NY 10504 

U.S.A. 

Produced in the United States of America 

February 2009 

All Rights Reserved 

IBM, the IBM logo and ibm.com are trademarks 

or registered trademarks of International 

Business Machines Corporation in the 

United States, other countries, or both. If these 

and other IBM trademarked terms are marked 

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published. Such trademarks may also be registered 

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A current list of IBM trademarks is available 

on the Web at ”Copyright and trademark information” 

at ibm.com/legal/copytrade.shtml. 

Other product, company or service names may 

be trademarks or service marks of others. 

References in this publication to IBM products 

or services do not imply that IBM intends to 

make them available in all countries in which 

IBM operates. 

1 IBM Corporate Social Responsibility: Attaining 

Sustainable Growth through Corporate Social 

Responsibility, 2008. 

ibm.com/ibm/ideasfromibm/us/csr/20080401/ 

index.shtml. 

2 The Enterprise of the Future: IBM Global CEO 

Study 2008. 

ibm.com/ibm/ideasfromibm/us/ceo/20080505/ 

index.shtml. 

3 IBM Project Big Green, 2008. 

http://www-03.ibm.com/press/us/en/presskit/ 

21440.wss. 

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